Bank of America thought it was laying claim to a crown jewel of American mortgage lending when it scooped up Countrywide Financial Corp. at the depths of the housing crisis in 2008.

With a name reflecting its ambition, Countrywide transformed itself from a regional lender in Calabasas to a burgeoning powerhouse. It seemed to have perfected the elusive art of making home loans to borrowers with scuffed credit.

But the deal quickly became a millstone for Bank of America, U.S. taxpayers and the American economy when Countrywide dissolved in a heap of bad loans and shoddy bookkeeping.

The extent of Countrywide's wayward behavior is still coming to light four years after the deal. New revelations emerged Wednesday in a mammoth lawsuit filed by the federal government.

Countrywide code-named its mortgage program "the Hustle" to prod employees to churn out loans as the housing market was beginning to crack.

The name was apt, said Preet Bharara, the U.S. attorney in Manhattan who brought the suit, because it underscored dubious behavior that began at Countrywide and continued at Bank of America. In its haste to stick the government with loans that it knew were flawed, Countrywide dispensed with traditional internal safeguards designed to ensure loan quality, according to the suit. The suit, which seeks treble damages, says the abuses occurred from 2007 to 2009.

"The fraudulent conduct alleged in today's complaint was spectacularly brazen," Bharara said. "Countrywide and Bank of America made disastrously bad loans and stuck taxpayers with the bill."

Bank of America said in a statement that it "has stepped up and acted responsibly to resolve legacy mortgage matters."

"At some point, Bank of America can't be expected to compensate every entity that claims losses that actually were caused by the economic downturn," the statement said.

Housing advocates hailed the suit but said Countrywide-related losses far exceed the amount the government is seeking.

"It's better late than never, but it sure as heck should have been earlier and should have been more," said Dennis Kelleher, chief executive of Better Markets Inc., a liberal nonprofit group focused on financial reform.

BofA bought Countrywide for about $2.5 billion and has racked up more than $30 billion in legal costs, write-downs and other charges since the acquisition. Numerous reports said BofA's directors last year discussed putting the Countrywide unit into bankruptcy if it continued to hemorrhage money.

U.S. taxpayers had to ante up $137 billion after the government bailed out Fannie and Freddie in the financial crisis. The companies are quasi-governmental entities that guarantee millions of home loans.

By inflating the mortgage balloon, Countrywide played an outsized role in the housing crisis and ensuing recession, critics say.

"Countrywide was the poster child for the problems that precipitated the financial crisis," said Kevin Stein, associate director of the San Francisco-based California Reinvestment Coalition.

"We're still seeing the effects in terms of people going into foreclosure as a result of the Countrywide practices," Stein said. "People are still suffering."

Though the U.S. housing market recently has begun to rebound, many areas of the country remain shaky.

The BofA case is one of several filed recently by the government against banks, part of an aggressive effort to hold big institutions responsible for the housing collapse that ultimately dragged the U.S. into a deep recession.

But the timing of the suits, weeks before the presidential election, has drawn criticism from some who say the Obama administration is trying to appear tough on Wall Street.

They also contend that it's hypocritical for the government to sue big financial institutions that bought troubled rivals at the urging of federal officials, who sought at the time to avoid expensive bailouts.

"It looks like the Soviet Union show trials have moved to the United States," said Richard Bove, a banking analyst at Rochdale Securities. "We set up a group of witch hunters, like they had in Salem, Mass. Or like what Joe McCarthy did. This is McCarthyism."

BofA's 2008 acquisition of Countrywide is regarded by many analysts as the worst takeover in banking history.

The lawsuit puts Countrywide back in the public eye two years after federal prosecutors decided they had no criminal case against Angelo Mozilo, the brash son of a Bronx butcher, who built the Calabasas company into the nation's largest home lender. Mozilo could not be reached for comment.